Chinese food in the first half net profit is expected to decline 40%

Chinese food (00506.HK) Express yesterday first-half earnings, due to a substantial decline in net profit liquor business, the company's unaudited consolidated net profit in the first half of this year is expected to decline by 40% year on year.

Chinese food wine business is the "Great Wall" and "Greatwall" wine production, marketing and sales, first half of 2009, Chinese Food "Great Wall" wine sales of 5.87 million tonnes, sales of 15.71 billion Hong Kong dollars, the whole Chinese food first half of 2009 was 3.93841 billion profit, net profit fell 40 percent as calculated in accordance with the Chinese food in the first half net profit of around 2.4 billion.

Chinese food explained that the drop in net profit was mainly due to alcohol (and other) business, net profit dropped significantly. The first half of this year, China's food division of its wine marketing model to adjust the multi-layer distribution structure to streamline and reduce the current distribution of some dealer orders for the regional and focus resources and change the conditions for cooperation with distributors, some of dealers to reduce the current orders, resulting in sales in 2009 decreased compared to the same period.

In addition, the Chinese food in the process of optimizing product mix, the market costs to sales expense as percentage of revenue increase compared with the same period in 2009.

Note: COFCO Chinese food for the listed companies in Hong Kong.